Soul in German city church (7)
I believe the answer is:
essence
'soul' is the definition.
'german city church' is the wordplay.
'german city' becomes 'essen' (city in Germany).
'church' becomes 'CE' (Church of England).
'essen'+'ce'='ESSENCE'
'in' acts as a link.
(Other definitions for essence that I've seen before include "Indispensable" , "Concentrated liquid flavouring" , "Concentration; nub" , "A thing's intrinsic nature" , "Intrinsic character" .)